COP21 – it’s all about the money

Paris agree­ment has made strides in in­creas­ing fi­nance to help the least de­vel­oped coun­tries cope with cli­mate change

CityPress - - Busi­ness - YOLANDI GROE­NEWALD in PARIS busi­ness@city­press.co.za

Money was at the top of the agenda at COP21 in Paris this week as talks on who will pay to mit­i­gate cli­mate change kept ne­go­tia­tors up late. While huge is­sues around fi­nanc­ing are still out­stand­ing in the fi­nal ac­cord, the Paris agree­ment made strides in up­ping fi­nance to help the world’s least de­vel­oped coun­tries cope with cli­mate change.

The de­vel­op­ing world lacks the tech­nol­ogy to cut green­house gas emis­sions, and the in­fra­struc­ture is too frag­ile to cope with ex­treme weather.

As ex­pected, the de­vel­op­ing world’s in­sis­tence that rich coun­tries sup­ply them with at least $100 bil­lion (R1.6 tril­lion) a year by 2020 to adapt to cli­mate change and put their economies on a low-car­bon tra­jec­tory re­mained a huge stick­ing point dur­ing the two weeks of ne­go­ti­a­tions. But the Paris agree­ment at least moved to get­ting rich coun­tries to start up­ping their con­tri­bu­tions.

Devel­op­ing coun­tries in­sisted that the $100 bil­lion be set as a min­i­mum, and that fund­ing starts in­creas­ing dra­mat­i­cally af­ter 2020. This fund­ing will ul­ti­mately evolve into a cru­cial in­stru­ment for driv­ing the de­vel­op­ment of cli­mate-re­silient in­fra­struc­ture in Africa.

Most of the de­vel­op­ing world’s sub­mit­ted pledges to cut their car­bon emis­sions were made on the con­di­tion that they re­ceive the nec­es­sary fi­nances and tech­nol­ogy trans­fers. A num­ber of coun­tries out­lined that they could sig­nif­i­cantly cut emis­sions be­yond their pledges if they had sup­port, but that they would strug­gle to ful­fil prom­ises if left to fend for them­selves.

Be­fore Paris, only mod­est pledges had been made, while gov­er­nance and dis­tri­bu­tion mech­a­nisms were nowhere to be found.

“It is im­por­tant that this fund is trans­par­ent, and that we know what the money will be used for,” said Mistry.

She said if the agree­ment failed, coun­tries would only dish out money in bi­lat­er­als, un­der­min­ing trans­parency. Coun­tries with poor con­tacts would also lose out.

Rich coun­tries, how­ever, want ma­jor de­vel­op­ing na­tions such as China and In­dia to also con­trib­ute to the pot. This week, there were sev­eral fall­outs in the ne­go­ti­a­tions when it was raised that these ma­jor de­vel­op­ing coun­tries had enough money in their economies to help out.

The rich coun­tries pointed out that the eight coun­tries, in­clud­ing China, classed as de­vel­op­ing had al­ready made “cli­mate fi­nance” con­tri­bu­tions that would aid those poorer than them. But Xie Zhen­hua, China’s spe­cial rep­re­sen­ta­tive for cli­mate change, said these con­tri­bu­tions were bi­lat­eral agree­ments and should not be counted as part of the $100 bil­lion pot.

The Ba­sic coali­tion (a bloc of four large newly in­dus­tri­alised coun­tries – Brazil, South Africa, In­dia and China) sev­eral times this week urged rich na­tions to “pro­gres­sively and sub­stan­tially scale up their sup­port” be­yond their col­lec­tive pledge of $100 bil­lion in an­nual cli­mate fi­nanc­ing by 2020.

In­dia’s en­vi­ron­ment min­is­ter, Prakash Javadekar, said the ac­tion of the de­vel­op­ing world de­pended on fi­nance and tech­no­log­i­cal sup­port from the de­vel­oped world.

“Be­cause they have, and we don’t have, the haves must pro­vide,” he said.

So far, the de­vel­op­ing world has not seen much of the promised funds.

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